COVER has launched a campaign, initially in partnership with the Protection Review, to reform the practice of writing list-based occupational definitions (Activities of Daily Living and Working - ADL and ADW) for income protection.
The details and background are available below and from Kevin Carr of the Protection Review, who gives an excellent round-up of the underlying case for change.
COVER for its part undertakes to give a platform to the campaign and will give regular updates as well as hosting articles, blogs and opinion.
Hopefully, this practice will swiftly die out as more and more of you refuse to sell these policies.
The issue was in the national news recently as a policyholder successfully took his case to the Ombudsman on being refused a pay out on the basis of ADW.
The Ombudsman ordered the insurer to pay out, referring to the supportive comments from the client's doctors.
So COVER asks ‘Surely this is the last nail in the coffin?'
The practice of including list-based definitions such as these has not been in many people's good books in recent years.
A recent Protection Review survey of advisers asked: "Should the industry seek to address the perceived ongoing problems with ADL and ADW-based definitions for IP policies?"
Only 16% were happy with the status quo.
While 42% wished for change, they were also mindful that their removal would make policies pricier for those on tight budgets.
The remaining 42% were for outright scrapping.
COVER intends to facilitate further discussion and highlight those brokerages and organisations that swing their weight behind the campaign.
To date, on start-up, the Protection Review has declared for change, as has protection specialist Roy McLoughlin of Master Adviser.
He sits on the Income Protection Task Force, which is thought to be polling its members before backing COVER's campaign.
